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Statistics on Hong Kong's Gross National Product (GNP) and External Factor Income Flows (EFIF) for the fourth quarter of 2008 and the whole year of 2008 are released today (March 13) by the Census and Statistics Department.
In the fourth quarter of 2008, Hong Kong's GNP recorded a marginal increase of 0.7% over a year earlier to $453.6 billion at current market prices. The Gross Domestic Product (GDP), estimated at $436.4 billion at current market prices in the same quarter, recorded a 2.6% decrease during the period. Compared with GDP, the value of GNP was larger by $17.2 billion in the fourth quarter of 2008, representing a net external factor income inflow of the same amount, and equivalent to 3.9% of GDP in that quarter.
After netting out the effect of price changes, Hong Kong's GNP increased by 0.7% in real terms in the fourth quarter of 2008 over a year earlier, compared to the corresponding decrease of 2.5% recorded for GDP in the same quarter.
Total factor income inflow into Hong Kong, estimated at $207.5 billion in the fourth quarter of 2008 and equivalent to 47.5% of GDP in that quarter, decreased by 18.2% over a year earlier. Meanwhile, total factor income outflow, estimated at $190.3 billion in the fourth quarter of 2008 and equivalent to 43.6% of GDP of the same period, recorded a decrease of 24.1% over a year earlier. Taking the inflow and outflow together, a net external factor income inflow of $17.2 billion was recorded in the fourth quarter of 2008.
Within total factor income inflow, Direct Investment Income (DII) dropped by 3.4% over a year earlier, mainly due to the decrease in earnings of some prominent local enterprises from investment abroad. Portfolio Investment Income (PII) recorded a drop of 14.8%, mainly attributable to the decrease in interest income received from holdings of non-resident debt securities by resident investors. Other Investment Income (OII) recorded a substantial drop of 61.0%, mainly due to the decrease in the interest rates of the overseas banking sector.
Within total factor income outflow, DII decreased by 21.3% over a year earlier, largely attributable to the decrease in earnings of some prominent multinational enterprises from investment in Hong Kong. PII increased by 21.1%, mainly due to the increase in dividend income received from holdings of resident publicly listed companies by non-resident investors. OII decreased significantly by 52.5%, mainly due to the decrease in the interest rates of the local banking sector.
Analysed by country/territory, the mainland of China (the Mainland) continued to be the largest source of Hong Kong's external factor income inflow in the fourth quarter of 2008, accounting for 37.5%. This was followed by the British Virgin Islands (BVI), with a share of 24.0%, reflecting continued investment income inflow from this tax haven economy where Hong Kong companies had set up a considerable number of holding companies. Other major source countries/territories were the United States of America and the United Kingdom, at 6.6% and 4.4% respectively.
The Mainland and the BVI were also the most important destinations for Hong Kong's external factor income outflow in the fourth quarter of 2008, accounting for 28.9% and 26.6% respectively. Other major destination countries/territories included the United States of America, at 8.5%, and the Netherlands, at 8.0%.
For 2008 as a whole, Hong Kong's GNP increased by 6.1% over a year earlier to $1,760.0 billion at current market prices. The difference of $81.4 billion from GDP for the same year (estimated at $1,678.5 billion) represented a net factor income inflow of the same amount and equivalent to 4.9% of GDP in the year. After netting out the effect of price changes, Hong Kong's GNP increased by 4.5% in real terms in 2008 over 2007. The total factor income inflow was estimated at $940.9 billion, or 56.1% of GDP in 2008 while the corresponding outflow at $859.5 billion, or 51.2% of GDP.
Further Information
GDP and GNP are closely related measures of economic performance. GDP is the total value of production of all resident producing units within the territory. GNP denotes the total income earned by residents of a particular territory, regardless of the place in which the economic activities generating the income are undertaken. In other words, GNP is obtained by adding to GDP factor income earned by residents from outside the territory and deducting factor income earned by non-residents within the territory.
The above EFIF figures are compiled based on data obtained from the Survey of External Claims, Liabilities and Income, supplemented by data from other sources.
Figures of GNP and EFIF from the first quarter of 2007 to the fourth quarter of 2008 analysed by income component are presented in Table A, while the country/territory breakdowns of external factor income inflows and external factor income outflows for the same period are presented in Tables B(1) and B(2) respectively.
Statistics on GNP and EFIF for 2008 are preliminary figures. They are subject to revision when more data become available.
Enquiries about GNP and EFIF statistics may be directed to the Balance of Payments Branch (2) of the Census and Statistics Department at 2116 5102.
Ends/Friday, March 13, 2009
Issued at HKT 16:30
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